People should rebuild where they want as much as they want, so long as they’re willing to accept the financial risk to do so (I.E. higher premiums that reflect the risk… which may be 10x higher, who knows! A lot of these Palisades home owners could, and would, pay for that risk, if only the law would let an insurer charge them for that)

State law does not let that happen, and all the risk is therefore subsidized by everyone else or not offered at all. Both worse outcomes!

I'm not sure that's the correct take-away. I think you had in correct in the second sentence.

> Do not rebuild in the exact same place, in the exact same way

If your area is a fire-prone, then yes I think you should be allowed to build there. However, your house better have taken into account fire. Whether it means you can't build houses within an acre of another or it has to be all stone, idk let qualified people figure out the requirements. But eventually everywhere in the US will have been hit by a natural disaster and the rule can't be you can't re-build, it just needs to be you need to account for what is likely to happen.

As to flooding, I don't know the specifics but if instead of rebuilding the same you put the house on stilts so just the staircase floods out every couple of years I think it's fine.